Copper market demand is still considerable

"China's copper consumption, including imports, will surely grow again, but the increase will not be as high as it once was," said Jiao Jian, general manager of Minmetals Nonferrous Metals Co., Ltd. He pointed out that China's “industrialization, urbanization, marketization, and internationalization” are being further advanced. For example, in terms of urbanization, it is expected that by 2030, China’s urbanization rate will reach 65% or more, which means there will be more than 2 With a population of 100 million entering the cities, the demand for copper will remain strong in the coming years.

Wu Yueneng, deputy general manager of Jiangxi Copper Industry, also stated that with the advancement of urbanization, China’s copper demand in the future will still have much room for growth. He pointed out that at present, copper consumption in developed countries exceeds 10 kilograms per capita, China only has 5.7 kilograms, and China has a population of 1.3 billion. If calculated according to consumption levels in developed countries, this will translate into 13 million tons of potential copper consumption. He expects that China's refined copper consumption will reach 7.68 million tons by the end of this year, an increase of 4.8% from 7.33 million tons in 2011, which is a decrease from the forecast at the beginning of the year. On the supply side, Wu Yuen-Neng expects to reach 5.6 million tons this year. However, he also pointed out that the realization of expansion of production capacity is also constrained by several factors. The environmental assessment and the high external dependence of copper resources will affect the project's capacity production and capacity utilization. Moreover, as smelting is currently in a state of deficit, even if scale is formed, the utilization rate of the production capacity may be discounted.

Foreign companies and institutions are also more optimistic about China’s future copper consumption. Stefan Bole from Germany's Aurubis AG said that although China’s consumption has fallen compared to before and it has not reached double digits, the growth rate will remain at a relatively high level. Liu Boya, head of China's bulk commodities research department of Macquarie Group, believes that China’s copper consumption will be better than this year next year. She predicts that as infrastructure investment will continue to drive China's metal demand, growth in copper consumption in China next year may increase by 6% to 7%, which is higher than this year's 3%. China's copper demand this year is expected to be 8.3 million tons.

Liu Boya said that historical data shows that in the third year of the five-year planning period, China’s fixed asset investment generally shows a growth trend. The next year is exactly the third year of the “Twelfth Five-Year Plan,” and China’s investment in fixed assets is also expected to increase. The recovery of the Chinese construction market and the end of the destocking process of copper end consumer companies will all help to boost demand for copper next year. Regarding the trend of copper prices next year, she said that as the world is implementing a loose monetary policy, it is expected that international copper prices will not be subject to a sharp drop next year, but price volatility will increase.